iPhone 3G rocks Japanese smartphone market

Posted:
in iPhone edited January 2014
Mobile providers in Japan are crediting the launch of Apple's iPhone 3G with dramatically shifting large numbers of subscribers between providers. The impact of the new phone is also answering critics who insisted the iPhone would find only limited interest in Japan.



Big in Japan



According to the report "iPhone Affects KDDI's Net Subscription Growth," by Japanese tech business journal Tech-On, SoftBank Mobile, Apple's exclusive provider of the iPhone 3G in Japan, led other providers in the country in new mobile phone subscriptions, grabbing up 215,400, more than half of the 391,500 new activations in Japan during the month of July. "We believe our large net growth was an iPhone effect," SoftBank representatives said.



Rivals service provider KDDI agreed, noting that new cancelations related to customers' porting their numbers to another provider surpassed new incoming transfers for the first time ever in July. It too credited the iPhone 3G launch with the unusual shift. "We are accepting the fact, considering that our handsets weren't attractive enough," KDDI's PR group said.



Japan's Cultural Barriers



Many originally predicted that Apple's phone would flop in Japan, a market where phone hardware and mobile networks have long offered greater sophistication than other markets, and particularly when compared to the US. Apple's original iPhone could not be used in Japan because there is no 2G GSM service in the country; Japanese providers pioneered the deployment of advanced 3G mobile networks a decade ago, skipping the second generation entirely.



Other critics pointed out that the iPhone lacked a variety of culturally significant elements unique to the Japanese mobile market, including the ability to scan the QC barcodes that appear everywhere, inclusion of Sony's RFID-based "FeliCA" swipe chip for purchases (used by vending machines), and the capacity to enter Japanese characters, including "emoji," a popular new set of scores of pictographs (below) many people in the country consider essential in mobile messaging.Â*







Differences in the Japanese market previously frustrated Apple's ability to increase Mac sales there, as many Japanese, particularly the youth demographic, now use smartphones in place of full sized computers. Microsoft has faced similar problems in trying to sell its Xbox game consoles in the country, where tastes in gaming software simply differ.



"Breakthrough" Internet device



The cultural barriers originally expected to hold back interest in the iPhone 3G have not been enough to overcome Apple's strong brand and the fascination with the iPhone's slick and pioneering interface. Â?Just the interface itself is enough reason for me to buy the iPhone," said Andrew Shuttleworth in a Macworld story exploring the iPhone's potential in the Japanese market.



Shuttleworth, described as "a long time Windows Mobile user," added, "the best thing about it is that I can get a full web surfing experience Â? something IÂ?ve wanted for a long time." While Japanese phones have led the technology curve in a number of areas, Shuttleworth said the "Internet on Japanese mobile phones have been following the i-mode system ever since. It has hardly improved even when smart phones arrived in 2005, but I think the iPhone can change that.Â?



The existing feature omissions on the iPhone appear to have little impact on its uptake among users. An AP article covering the iPhone 3G launch cited early adopter Kentaro Tohyama as noting that he would simply continue to also use his existing phone for emoji-laced messaging with friends, explaining, "I don't want my friends to think I'm this uncool, cold-hearted person."



From the makers of iPod



Another factor that has helped launch the iPhone 3G in Japan is that Apple's iPod is already wildly popular there. In addition to brand recognition, the Japanese market also seems to be attracted to Apple's simple, easy to use interfaces, which is not a strong point in other existing devices being sold in the Japanese market.



Sony's entrenched leadership in the MP3 market with its Walkman was eviscerated by Apple's far simpler to use iPod in Japan and worldwide, while theÂ*Sony Connect online store also couldn't even manage get off the ground even as iTunes grew exponentially. Ease of use and simplicity were major reasons why Apple cleaned up the music player market.



Similarly, while Japanese phones are revered for their exceptional hardware styling and features, they also sport complex menus that are difficult to navigate and services that are often impractical to use, leaving many of their pioneering features ignored. As one reader noted, "most phones in Japan felt like you're running Windows 98."Â*



Another example is the TV playing "1Seg" feature that Japanese phone makers have been rushing to market. It is largely just impractical. One user described the feature as "a notorious battery gobbling monster. Fourty-five minutes of watching TV on the cell phone would kill the battery." Signal reception of the UHF system is also terrible when traveling faster than a brisk walk.



Apple has often received criticism for taking a unique approach to engineering that only tends to include features that are practical and usable rather than following the industry trend to layer on features thick to see which stick. On the iPhone, Apple has even erected limitations on third party developers, efforts that are intended to keep its products simple and reliable rather than full featured but complex and problematic.Â*



iPhone-induced globalization



Apple's exclusive partnership with SoftBank in Japan has also made it clear that significant numbers of users are willing to migrate to another provider to get the iPhone, a fact also reported by AT&T in the US, and O2 in the UK. That not only brings increased attention to the iPhone, but also enables Apple to negotiate favorable service agreements, market promotion deals, and custom support for differentiating features on the iPhone, including Visual Voicemail.



Conversely, Apple's launch successes in Japan and Europe should also help accelerate the adoption of technologies demanded in those markets to the US, which has long been a backwater of stagnant mobile technology. The iPhone 3G has already bolstered AT&T's support for developing its UMTS network here in the US.



Apple's universal product strategy, which seeks to sell the same products globally rather than develop custom devices tailored to each market, has also brought international keyboard support (including Chinese handwritten input) to American users. It will likely also result in the import of Japan's QC barcodes and could possibly result in a wireless payment system similar to Sony's FeliCA. The iPhone's universal Apps Store should also facilitate in an influx of international software, which in turn will help Apple in its push to enter enterprise markets worldwide.
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Comments

  • Reply 1 of 125
    melgrossmelgross Posts: 30,517member
    It gets tiring hearing from a very few people who tell us that they "know" how badly the iPhone is doing in their countries.



    I doubt they know much of anything when it comes to phones. It's also possible that they say this to try to make it SEEM as though the product is doing poorly, when it obviously isn't. What their problem is, I don't know.



    This isn't the first report that shows the iPhone is doing well in Japan.
  • Reply 2 of 125
    jfanningjfanning Posts: 3,379member
    Quote:
    Originally Posted by melgross View Post


    It gets tiring hearing from a very few people who tell us that they "know" how badly the iPhone is doing in their countries.



    I doubt they know much of anything when it comes to phones. It's also possible that they say this to try to make it SEEM as though the product is doing poorly, when it obviously isn't. What their problem ism I don't know.



    This isn't the first report that shows the iPhone is doing well in Japan.



    Yeah I know, I get sick of the people who all claim the all other manufactures are about to close down as Apple has sold 10 million phones in an market of 1.15 billion
  • Reply 3 of 125
    melgrossmelgross Posts: 30,517member
    Quote:
    Originally Posted by jfanning View Post


    Yeah I know, I get sick of the people who all claim the all other manufactures are about to close down as Apple has sold 10 million phones in an market of 1.15 billion



    That's the opposite absurdity.



    Neither is true.
  • Reply 4 of 125
    jfanningjfanning Posts: 3,379member
    Quote:
    Originally Posted by melgross View Post


    That's the opposite absurdity.



    Neither is true.



    Well the current mobile phone sales figures are around 1.15 billion per year.

    Apple fans are constantly dooming all other mobile manufactures.



    The only one left is Apple has sold 10 million phones, so is this the incorrect one?
  • Reply 5 of 125
    Is the iPhone the biggest leap forward in phones this century?



    Now that we've sorted that out, no one's talking about driving competitors out of business. Just giving the whole industry a much needed kick up the backside and getting progress back in order.





    Great article as always Prince Dan.



    The AppStore may well put an end to the trouble with those mysterious smiley symbols. Indeed, the only limit on the iPhone is developers and Apple's imagination. Unlike the now obsolete generation of hardware it's up against.



    Looking forward to seeing what Japan's handset makers do next. They're the closest thing Apple have to a direct rival besides RIM.
  • Reply 6 of 125
    monstrositymonstrosity Posts: 2,174member
    Quote:
    Originally Posted by melgross View Post


    That's the opposite absurdity.



    Neither is true.



    There sure will be casualties though, the only hope many handset manufacturers have of surviving is to hope Android pulls through (which im confident it will) and ditch whatever their current OS of choice is.
  • Reply 7 of 125
    olternautolternaut Posts: 1,376member
    Bloodbath.
  • Reply 8 of 125
    jfanningjfanning Posts: 3,379member
    Quote:
    Originally Posted by monstrosity View Post


    There sure will be casualties though, the only hope many handset manufacturers have of surviving is to hope Android pulls through (which im confident it will) and ditch whatever their current OS of choice is.



    Saying many is a little extreme, Motorola maybe. The other big names manufactures will be fine.
  • Reply 9 of 125
    melgrossmelgross Posts: 30,517member
    Quote:
    Originally Posted by jfanning View Post


    Well the current mobile phone sales figures are around 1.15 billion per year.

    Apple fans are constantly dooming all other mobile manufactures.



    The only one left is Apple has sold 10 million phones, so is this the incorrect one?



    Apple isn't competing with 1.1 billion phones sales a year. They are just beginning to compete with the 100 million smartphone sales a year.



    As you can see from this article, and I'm assuming that you haven't read any other article by any other writer in any other publication anywhere, Apple is doing quite well in Japan, which a couple of people have tried to tell us wasn't true. But it is.



    When you look to see how well a new product it doing, you,look at its sales growth. Not the total number of sales relative to established products. It takes a few years to move up in the ranks.



    I remember when I bought my Samsung i300 Palmphone years ago, that Samsung was but a small player in the phone business, with only about a 5% marketshare. No one thought that Samsung understood the business well enough to move up. But they were wrong, and now Samsung is one of the largest cell manufacturers in the world.



    Apple is competing only in the smartphone market. Right now, that;s about 10% of the market overall, but is the most profitable part. That part is expected to move to 30% in a few years, mostly because Apple has made people aware of it more than before.



    This is like the digital camera market. Only 7.5% of all digital cameras are D-SLR's. But almost all the profit is centered around those D-SLR's. The point and shoot market is losing money quickly, except for a few products.



    Which part of that market would a company rather have, a good part of the 7.5% that is highly profitable, or a large share of the 92.5% that is losing money?



    Apple will have a large share of that profitable market, while most likely ignoring the basic phone market.



    Will Apple take the market over? Who knows? No one thought MS would take the OS and Office markets over either in the mid '80's.
  • Reply 10 of 125
    melgrossmelgross Posts: 30,517member
    Quote:
    Originally Posted by monstrosity View Post


    There sure will be casualties though, the only hope many handset manufacturers have of surviving is to hope Android pulls through (which im confident it will) and ditch whatever their current OS of choice is.



    Oh, there will be causualties. There always are. The market will consolidate as it matures, and only the strongest will survive.



    But it's also looking dimmer for Android. I'm not so sure it will make it.
  • Reply 11 of 125
    gqbgqb Posts: 1,934member
    Quote:
    Originally Posted by jfanning View Post


    Well the current mobile phone sales figures are around 1.15 billion per year.

    Apple fans are constantly dooming all other mobile manufactures.



    The only one left is Apple has sold 10 million phones, so is this the incorrect one?



    Apples and oranges... Apple doesn't sell 'phones'.



    We've had to listen for a year about how Japanese users would never settle for the iPhone because of the 'critical features' it lacked.

    Those nay-sayers always seemed to think that the Japanese are incapable of valuing usability of base features on a smartphone.
  • Reply 12 of 125
    Quote:
    Originally Posted by AppleInsider View Post


    The existing feature omissions on the iPhone appear to have little impact on its uptake among users. An AP article covering the iPhone 3G launch cited early adopter Kentaro Tohyama as noting that he would simply continue to also use his existing phone for emoji-laced messaging with friends, explaining, "I don't want my friends to think I'm this uncool, cold-hearted person."



    Ah this is an interesting comment. Japanese users understand the limitations of communicating via messaging, and they would not rely on it without using emoji to compliment the message. For example, Everyone is talking about you comes across differently than Everyone is talking about you.



    I think emoji is used often because messaging in Japanese or Chinese with most mobile phone is quite involved, so these predefined emoticons help convey a message conveniently without entering too much more characters. However, the easier input interface on the iPhone may change this. Although, it would still be nice to have it, emoji. I think it would be nice if the mail app would also interpret both emoji and emoticons, because a picture is worth a thousand words
  • Reply 13 of 125
    My goodness. How can the iPhone possibly be successful in Japan without having emoji and a hole for dangling trinkets? Suppose the Japanese handset user really wants the same things that are offered for Americans, perish the thought, such as a full internet browsing experience and a very simple user interface. Can the Japanese live without FeliCa and 1-Seg. I'm not sure about Apple getting around the lack of FeliCa, but 1-Seg could be replaced with simple Youtube availability. There are more than enough videos to keep the Japanese occupied. An efficient manga reading app was made available for the iPhone which might also keep the Japanese pleased.



    I'm very curious to see whether or not the average Japanese cellphone user can be tempted by the iPhone. I do think that some of the fashionable, long-nailed Japanese women might have to take a pass on the touch-screen input.
  • Reply 14 of 125
    irelandireland Posts: 17,207member
    Whatever it is that group of emoticons they use Apple should add them to the iPhone software for over there (when they choose that language an emoticon button could appear on page 2 of that keyboard, and when pressed it could provide access to all of them). But that would be too simple a solution for Apple, wouldn't it? Get on it Apple, it's time to de-wax those ears again.
  • Reply 15 of 125
    jfanningjfanning Posts: 3,379member
    Quote:
    Originally Posted by melgross View Post


    Apple isn't competing with 1.1 billion phones sales a year. They are just beginning to compete with the 100 million smartphone sales a year.



    No, they are competing against all cellphone sales.





    Quote:
    Originally Posted by melgross View Post


    As you can see from this article, and I'm assuming that you haven't read any other article by any other writer in any other publication anywhere, Apple is doing quite well in Japan, which a couple of people have tried to tell us wasn't true. But it is.



    No, why would I. I don't live in Japan, and I have no interest in the Japanese phone market. I was just replying to your phone regarding a subjective article. What does "doing quite well in Japan" mean? .05% market share, 1% market share, what exactly?



    Quote:
    Originally Posted by melgross View Post


    I remember when I bought my Samsung i300 Palmphone years ago, that Samsung was but a small player in the phone business, with only about a 5% marketshare. No one thought that Samsung understood the business well enough to move up. But they were wrong, and now Samsung is one of the largest cell manufacturers in the world.



    Yes, at the end of 2007 they were around 14.5% market share, compared to Nokia's 39%



    Quote:
    Originally Posted by melgross View Post


    Apple is competing only in the smartphone market. Right now, that;s about 10% of the market overall, but is the most profitable part. That part is expected to move to 30% in a few years, mostly because Apple has made people aware of it more than before.



    As I have said, they are competing in all mobile phone sales, the majority of people do not go out and purchase a cheap phone, and a smart phone, they will purchase one phone.



    Also, the other manufactures are in a better position to compete on price as well, something Apple doesn't like doing.
  • Reply 16 of 125
    Quote:
    Originally Posted by melgross View Post




    This is like the digital camera market. Only 7.5% of all digital cameras are D-SLR's. But almost all the profit is centered around those D-SLR's. The point and shoot market is losing money quickly, except for a few products.



    Just bought myself a Nikon D300. Love it.
  • Reply 17 of 125
    Quote:
    Originally Posted by melgross View Post


    It gets tiring hearing from a very few people who tell us that they "know" how badly the iPhone is doing in their countries.



    I think the "knowing" part is more visual rather than information based. Here in Finland, where I am currently posted, I see hardly any iPhones, but rather than trust my eyes, I talk to my friends at Sonera. They say that the iPhone did okay, but not as well as expected. This is further borne out by the fact that you can walk into any Sonera shop, or other outlet and get an iPhone of choice, black, white, 16 gig, 8 gig. No waiting. This would imply that there is plenty of stock on hand. Several of my co-workers that ordered iPhones are still getting calls to see if they want to come down and pick one up. In this instance it would be easy to assume that the iPhone was not as big a hit as it was else where. Maybe Sonera will release some sales figures to back this up. For the most part, Finns do not like the locked in part of the iPhone contracts. It is a matter of the subscription terms rather than price.



    Quote:

    I doubt they know much of anything when it comes to phones. It's also possible that they say this to try to make it SEEM as though the product is doing poorly, when it obviously isn't. What their problem is, I don't know.



    Which people exactly. I do not think there are any iPhone haters here. The debates seem balanced actually. Some see things one way, while others see them another way.



    Quote:

    This isn't the first report that shows the iPhone is doing well in Japan.



    I bet you a Pepsi, you will soon see a report that the iPhone is doing poorly in Japan.
  • Reply 18 of 125
    samabsamab Posts: 1,953member
    Until they actually release the Japanese iphone sales number --- all this talk is pure PR BS.
  • Reply 19 of 125
    Is there a reason emoji can't be put on the iPhone? I must've missed something. I mean, how hard can it be to put smiley's on the thing? Is it a MS thing? I doubt someone owns emoticons.
  • Reply 20 of 125
    Quote:
    Originally Posted by samab View Post


    Until they actually release the Japanese iphone sales number --- all this talk is pure PR BS.



    Good point. No, great point.
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